Transportation contract for business support services awarded to Serco Management Services for over $158 million

Contract Overview

Contract Amount: $158,733,336 ($158.7M)

Contractor: Serco Management Services, Inc.

Awarding Agency: Department of Transportation

Start Date: 2010-02-01

End Date: 2016-06-22

Contract Duration: 2,333 days

Daily Burn Rate: $68.0K/day

Competition Type: FULL AND OPEN COMPETITION

Number of Offers Received: 3

Pricing Type: FIRM FIXED PRICE

Sector: Other

Official Description: SERCO AREA 5

Place of Performance

Location: RESTON, FAIRFAX County, VIRGINIA, 20190

State: Virginia Government Spending

Plain-Language Summary

Department of Transportation obligated $158.7 million to SERCO MANAGEMENT SERVICES, INC. for work described as: SERCO AREA 5 Key points: 1. The contract's value of over $158 million suggests a significant need for business support services within the Federal Aviation Administration. 2. Awarded under full and open competition, this contract likely benefited from a competitive bidding process to ensure fair pricing. 3. The duration of the contract (over 6 years) indicates a long-term need and potential for sustained service delivery. 4. The firm-fixed-price contract type generally shifts cost risk to the contractor, potentially leading to more predictable government spending. 5. The absence of small business set-aside flags suggests the primary contractor is not a small business, with potential implications for subcontracting opportunities. 6. The contract falls under 'All Other Business Support Services,' a broad category that may encompass a wide range of administrative and operational functions.

Value Assessment

Rating: fair

Benchmarking the value of this contract is challenging without specific service details and comparable contract data. However, a $158 million award over six years indicates a substantial investment by the FAA. The firm-fixed-price structure suggests an attempt to control costs, but the overall value-for-money depends heavily on the quality and efficiency of the services provided by Serco Management Services. Further analysis would require understanding the specific deliverables and performance metrics.

Cost Per Unit: N/A

Competition Analysis

Competition Level: full-and-open

The contract was awarded under full and open competition, indicating that all responsible sources were permitted to submit bids. The presence of 3 bidders suggests a moderate level of competition for this requirement. This competitive environment is generally favorable for price discovery and potentially leads to more cost-effective solutions for the government.

Taxpayer Impact: A competitive award process helps ensure that taxpayer dollars are used efficiently by driving down prices and encouraging high-quality service delivery.

Public Impact

The Federal Aviation Administration (FAA) is the primary beneficiary, receiving essential business support services. Services likely include administrative, operational, and management support critical to the FAA's functions. The contract's impact is primarily national, supporting the FAA's nationwide operations. The contract supports jobs within Serco Management Services and potentially its subcontractors, contributing to the professional services workforce.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Broad service category 'All Other Business Support Services' makes it difficult to assess specific performance without detailed SOW.
Contract duration of over 6 years could lead to complacency if not actively managed and overseen.
Lack of explicit small business set-aside raises questions about subcontracting opportunities for smaller firms.

Positive Signals

Awarded under full and open competition, suggesting a robust bidding process.
Firm-fixed-price contract type generally provides cost certainty for the government.
Contract awarded to an established entity (Serco Management Services) implies a degree of reliability.

Sector Analysis

This contract falls within the Business Support Services sector, a broad category encompassing a wide array of administrative, management, and operational assistance. The market for these services is highly competitive, with numerous providers ranging from large corporations to specialized firms. The FAA's spending in this area is likely driven by the need for specialized expertise or to augment its internal workforce for non-core functions. Comparable spending benchmarks would depend on the specific services rendered, but large government contracts for business support are common across various agencies.

Small Business Impact

The contract was not awarded as a small business set-aside, and the 'sb' field is false, indicating no explicit requirement for small business participation at the prime contract level. This suggests that the primary focus was on securing the best overall offer, rather than specifically promoting small business growth. However, Serco Management Services, as a large contractor, may engage small businesses as subcontractors to fulfill portions of the contract, which would be a positive outcome for the small business ecosystem if such opportunities are actively pursued.

Oversight & Accountability

Oversight for this contract would typically be managed by the contracting officer and program managers within the Federal Aviation Administration. Accountability measures are inherent in the firm-fixed-price contract type, where Serco is responsible for delivering services within the agreed-upon price. Transparency is generally facilitated through contract award databases, though specific performance metrics and oversight reports may not always be publicly accessible. The Inspector General for the Department of Transportation would have jurisdiction to investigate any potential fraud, waste, or abuse related to this contract.

Related Government Programs

Federal Aviation Administration Operations
Department of Transportation Administrative Support
Business Support Services Contracts
Government Management Services

Risk Flags

Broad service category may obscure specific performance issues.
Long contract duration requires sustained oversight.
Lack of explicit small business subcontracting goals.

Frequently Asked Questions

What is this federal contract paying for?

Department of Transportation awarded $158.7 million to SERCO MANAGEMENT SERVICES, INC.. SERCO AREA 5

Who is the contractor on this award?

The obligated recipient is SERCO MANAGEMENT SERVICES, INC..

Which agency awarded this contract?

Awarding agency: Department of Transportation (Federal Aviation Administration).

What is the total obligated amount?

The obligated amount is $158.7 million.

What is the period of performance?

Start: 2010-02-01. End: 2016-06-22.

What specific services were provided under this contract?

The contract, NA 561499, is categorized under 'All Other Business Support Services.' While the specific Statement of Work (SOW) is not detailed in the provided data, this broad category typically encompasses a wide range of administrative, management, and operational support functions. Examples could include call center operations, mailroom management, facilities support, human resources administration, financial processing, or other specialized business functions that an agency like the FAA might outsource. The exact services would have been defined in the contract's SOW, outlining deliverables, performance standards, and reporting requirements for Serco Management Services.

How does the $158 million contract value compare to similar FAA contracts for business support?

Direct comparison of the $158 million contract value to similar FAA contracts for 'All Other Business Support Services' is difficult without access to a comprehensive database of historical FAA procurements with detailed service descriptions. However, a contract of this magnitude, spanning over six years, suggests a significant and ongoing requirement for the services rendered. It indicates a substantial portion of the FAA's operational budget allocated to external support functions. To provide a precise benchmark, one would need to identify contracts with comparable scope, duration, and service categories within the FAA or other large federal agencies.

What is Serco Management Services' track record with the federal government, particularly the FAA?

Serco Management Services, Inc. is a known government contractor with a history of performing various services for federal agencies. While the provided data does not detail their specific performance on this particular FAA contract (2010-2016), their ability to win and execute a $158 million, multi-year contract suggests a level of established capability and past performance that met the FAA's requirements at the time of award. A deeper dive into federal procurement databases (like FPDS or SAM.gov) would reveal other contracts awarded to Serco, their performance ratings, and any significant issues or accolades associated with their work for the FAA and other agencies.

What were the key performance indicators (KPIs) or success metrics for this contract?

The provided data does not specify the Key Performance Indicators (KPIs) or success metrics for this contract. However, for a contract categorized under 'All Other Business Support Services' and awarded under a firm-fixed-price structure, KPIs would typically focus on the timely and accurate delivery of agreed-upon services, adherence to operational standards, and potentially cost-efficiency measures if applicable. For instance, if the contract involved call center operations, KPIs might include call answer rates, customer satisfaction scores, and average handling time. For administrative support, metrics could relate to processing times for documents or requests. These would have been detailed in the contract's SOW and performance work statement.

Were there any identified risks or challenges associated with this contract during its performance period?

The provided data does not explicitly list risks or challenges encountered during the performance of this contract. However, general risks associated with large, long-term service contracts include potential scope creep, contractor performance issues, changes in agency requirements, and budget fluctuations. Given the broad nature of 'Business Support Services,' challenges could arise from managing a diverse set of tasks, ensuring consistent quality across all functions, and adapting to evolving technological or regulatory environments within the FAA. The firm-fixed-price nature also means that unforeseen cost increases for the contractor could impact their willingness or ability to maintain service quality if not managed carefully.

How did the 'full and open competition' impact the final contract price and value?

The 'full and open competition' award type is designed to maximize the number of potential bidders, thereby fostering a competitive environment. This typically leads to downward pressure on prices as contractors vie to offer the most attractive bid. For this $158 million contract, the competitive process likely resulted in a more favorable price for the FAA compared to a sole-source or limited competition scenario. The fact that three bids were received suggests sufficient competition to allow for price discovery, although the optimal level of competition often involves more bidders. The final price reflects the negotiated terms based on the bids submitted and the government's evaluation criteria.

Industry Classification

NAICS: Administrative and Support and Waste Management and Remediation Services › Business Support Services › All Other Business Support Services

Product/Service Code: UTILITIES AND HOUSEKEEPING › HOUSEKEEPING SERVICES

Competition & Pricing

Extent Competed: FULL AND OPEN COMPETITION

Solicitation Procedures: NEGOTIATED PROPOSAL/QUOTE

Offers Received: 3

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 1818 LIBRARY ST STE 1000, RESTON, VA, 20190

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Not Designated a Small Business, Special Designations, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $236,432,041

Exercised Options: $158,733,336

Current Obligation: $158,733,336

Contract Characteristics

Commercial Item: COMMERCIAL ITEM PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline